THE Australian dollar weakened slightly after the International Monetary Fund warned of a prolonged growth slowdown in China.
At 6.30am AEST the local unit was trading at 91.79 US cents, down slightly from 91.83 cents at yesterday's local close. Twenty minutes earlier, the currency fell below yesterday's closing level after the IMF trimmed world economic growth expectations for 2013 to 3.1 per cent, down from the April forecast of 3.3 per cent.
China and other emerging economic powers now face new risks, the IMF warned, "including the possibility of a longer growth slowdown''.
Risk appetite, however, did not appear to be diminished by the new predictions, with US stocks closing higher for the fourth consecutive day. The Dow Jones Industrial Average rose 0.5 per cent, the broad-based S&P 500 added 0.72 per cent and the tech-rich Nasdaq Composite Index lifted 0.56 per cent.
